The COVID-19 outbreak should not have terrible news for gaming industry Hasbro (NASDAQ: HAS).
Remember: Tens of millions of Americans, confined to their homes under orders on the spot and banned from leaving for work, schools and summer camps canceled, children climbing the walls – all for months on end. What is the solution to such a situation?
TV, of course – but Hollywood is as close as the rest of the economy, and no one makes new shows. Books, I think – but do Americans read more? That … board games and toys, maybe?
Exactly. Board games and toys, which are simply the Forte of Hasbro.
Image Source: Getty Images.
And yet things have not worked out as well as they might have. When Hasbro reported its second-quarter earnings last month, the figures showed a sharp decline across the board (pun intended). Sales fell 13% year-on-year, and Hasbro lost $ 0.25 per share.
So it turned out, while Hasbro’s games segment the enjoying an impetus from the stay-at-home trend (sales up 11%), sales points were bumped by the fact that many of the physical stores that would otherwise have sold their games were closing down for the pandemic or if limited inventory took to retain cash.
Result: Hasbro, which sold more than $ 106 a share earlier this year, closed below $ 79 yesterday, losing 31% of its value since the beginning of the year. If you had invested $ 10,000 in Hasbro shares on January 1 of this year, you would have already lost $ 3,100 from that investment today.
And all you have left is $ 6,900.
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